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Atkore Inc. Announces Third Quarter 2021 Results

8.3.2021
  • Net sales of $853.7 million, up 121.8% versus prior year
  • Diluted earnings per share increased by $3.15 to $3.64; Adjusted net income per diluted share increased by $3.29 to $3.96
  • Net income increased by $151.2 million to $175.3 million; Adjusted EBITDA increased by $210.5 million to $274.3 million
  • Full-year Net sales expected to be up 60% compared to fiscal year 2020
  • Full-year Adjusted EBITDA outlook increased to $855 million - $875 million; Full-year Adjusted net income per diluted share outlook increased to $12.25 - $12.55

HARVEY, Ill.--(BUSINESS WIRE)-- Atkore Inc. (the “Company” or “Atkore”) (NYSE: ATKR) announced earnings for its fiscal 2021 third quarter ended June 25, 2021.

“Atkore’s outstanding performance continued this quarter, as we delivered record earnings and solid volume growth across the business,” said Bill Waltz, Atkore President and Chief Executive Officer. “We are continuing to benefit from strong demand and outstanding execution amidst industry supply constraints. Atkore’s focus on delivering for our customers has enabled us to grow our business, expand margins and deliver value to our shareholders and customers. The volume growth was across many product categories, and we are optimistic about the continued end market demand across multiple verticals. During the quarter, we also successfully refinanced our debt and repurchased $75 million of Atkore common stock, further strengthening our balance sheet and demonstrating our diligent approach to deploying capital.”

Waltz continued, “Given current market dynamics and our strong performance year-to-date, we are raising our fiscal year 2021 outlook for Adjusted EBITDA to $855-$875 million. We expect these favorable market dynamics to continue and combined with our strategic investments, we are also raising our perspective on fiscal 2022. Looking ahead, we will continue to invest in new products, marketing and business development to help improve Atkore’s position for the future.”

2021 Third Quarter Results

Effective in the first quarter of fiscal 2021, the Company renamed and redefined its reportable segments as “Electrical” and “Safety & Infrastructure.” See Segment Redefinition and Realignment discussion below.

 

 

 

Three months ended

(in thousands)

 

 

June 25, 2021

 

June 26, 2020

 

Change

 

% Change

Net sales

 

 

 

 

 

 

 

 

Electrical

 

$

661,163

 

 

 

$

272,151

 

 

 

$

389,012

 

 

 

142.9

%

Safety & Infrastructure

 

193,492

 

 

 

113,380

 

 

 

80,112

 

 

 

70.7

%

Eliminations

 

(997

)

 

 

(632

)

 

 

(365

)

 

 

57.8

%

Consolidated operations

 

$

853,658

 

 

 

$

384,899

 

 

 

$

468,759

 

 

 

121.8

%

 

 

 

 

 

 

 

 

 

 

Net income

 

$

175,297

 

 

 

$

24,078

 

 

 

$

151,219

 

 

 

628.0

%

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

Electrical

 

$

267,824

 

 

 

$

55,549

 

 

 

$

212,275

 

 

 

382.1

%

Safety & Infrastructure

 

22,365

 

 

 

14,150

 

 

 

8,215

 

 

 

58.1

%

Unallocated

 

(15,925

)

 

 

(5,975

)

 

 

(9,950

)

 

 

166.5

%

Consolidated operations

 

$

274,264

 

 

 

$

63,724

 

 

 

$

210,540

 

 

 

330.4

%

 

Net sales increased by $468.8 million, or 121.8%, to $853.7 million for the three months ended June 25, 2021, compared to $384.9 million for the three months ended June 26, 2020. The increase in net sales is primarily attributed to increased average selling prices of $342.8 million which were mostly driven by the PVC electrical conduit and fittings product category within the Electrical segment and increased net sales of $26.7 million due to the acquisitions of Queen City Plastics and FRE Composites Group. Pricing for PVC products, as well as other parts of the business, are expected to return to more normal historical levels over time, but that time is uncertain. The increase in net sales was also driven by an increase in sales volume of $90.9 million across nearly all product categories within both the Electrical and the Safety & Infrastructure segments.

Gross profit increased by $243.5 million, or 254.1%, to $339.3 million for the three months ended June 25, 2021, as compared to $95.8 million for the prior-year period. Gross margin increased to 39.7% for the three months ended June 25, 2021, as compared to 24.9% for the prior-year period. Gross profit increased primarily due to higher average selling prices of $342.8 million, partially offset by higher input costs of steel, copper and PVC resin of $124.0 million.

Net income increased by $151.2 million, or 628.0%, to $175.3 million for the three months ended June 25, 2021 compared to $24.1 million for the prior-year period primarily due to higher gross profit and lower interest expense, partially offset by higher selling, general and administrative costs, income tax expense and loss on extinguishment of debt.

Adjusted EBITDA increased by $210.5 million, or 330.4%, to $274.3 million for the three months ended June 25, 2021 compared to $63.7 million for the three months ended June 26, 2020. The increase was primarily due to higher gross profit.

Diluted earnings per share prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) was $3.64 for the three months ended June 25, 2021, as compared to $0.49 in the prior-year period. Adjusted net income per diluted share increased by $3.29 to $3.96 for the three months ended June 25, 2021, as compared to $0.67 in the prior year period. The increase in diluted earnings per share and adjusted net income per share is primarily attributed to higher net income.

Segment Results

Electrical

Net sales increased by $389.0 million, or 142.9%, to $661.2 million for the three months ended June 25, 2021 compared to $272.2 million for the three months ended June 26, 2020. The increase in net sales is primarily attributed to increased average selling prices of $290.6 million which was mostly driven by the PVC electrical conduit and fittings category and the metal electric conduit and fittings product categories and increased net sales of $26.5 million from the acquisitions of Queen City Plastics and FRE Composites Group. Pricing for PVC products, as well as other parts of the business, are expected to return to more normal historical levels over time, but that time is uncertain. Additionally, sales volume increased $64.1 million driven by increased volumes across all product categories.

Adjusted EBITDA for the three months ended June 25, 2021 increased by $212.3 million, or 382.1%, to $267.8 million from $55.5 million for the three months ended June 26, 2020. Adjusted EBITDA margins increased to 40.5% for the three months ended June 25, 2021 compared to 20.4% for the three months ended June 26, 2020. The increase in Adjusted EBITDA and Adjusted EBITDA margins was largely due to higher average selling prices in relation to changes in input costs, operational efficiencies and contributions from the acquisitions of Queen City Plastics and FRE Composites Group.

Safety & Infrastructure

Net sales increased by $80.1 million, or 70.7%, for the three months ended June 25, 2021 to $193.5 million compared to $113.4 million for the three months ended June 26, 2020. The increase is primarily attributed to increased average selling prices of $52.2 million driven by higher input costs of steel, and by higher volumes of $26.8 million primarily driven by increases across all product categories.

Adjusted EBITDA increased by $8.2 million, or 58.1%, to $22.4 million for the three months ended June 25, 2021 compared to $14.2 million for the three months ended June 26, 2020. Adjusted EBITDA margins decreased to 11.6% for the three months ended June 25, 2021 compared to 12.5% for the three months ended June 26, 2020. The Adjusted EBITDA increase is primarily due to the price and volume increases discussed above.

Segment Redefinition and Realignment

During the first quarter of 2021, Atkore made the decision to rename and reorganize its two reportable segments to better reflect each segment’s value proposition and go-to-market approach.

The Electrical Raceway segment, which was renamed as the Electrical segment, manufactures high quality products used in the construction of electrical power systems including conduit, cable, and installation accessories. This segment serves contractors in partnership with the electrical wholesale channel.

The Mechanical Products & Solutions segment, which was renamed as the Safety & Infrastructure segment, designs and manufactures solutions including metal framing, mechanical pipe, perimeter security and cable management for the protection and reliability of critical infrastructure. These solutions are marketed to contractors, original equipment manufacturers and end users.

Effective in the first quarter of fiscal 2021, the Company also implemented the realignment of its segment financial reporting structure such that its domestic cable management and prefabrication modular businesses are now reflected in its Safety & Infrastructure segment. These businesses were previously reflected within the Electrical Raceway segment. Prior year results have been revised for the impact of the realignment for comparability.

Full-Year Outlook

Based on market trends and Atkore’s continued execution, the Company is increasing its outlook for Net sales, Adjusted EBITDA and Adjusted net income per diluted share for fiscal year 2021. The Company expects Net Sales to be up approximately 60%, and Adjusted EBITDA to be in the range of $855 to $875 million. In addition, the Company expects Adjusted net income per diluted share to be in the range of $12.25 - $12.55. This updated outlook reflects Atkore’s expectation that the strong demand and industry supply constraints in the PVC electrical conduit business will continue through the rest of this fiscal year and that they will normalize in the next fiscal year.

In light of these trends and the current environment, the Company is also updating its perspective on fiscal year 2022. The Company expects fiscal year 2022 Adjusted EBITDA to be approximately $500 million - $550 million. The Company notes that this perspective may vary due to changes in assumptions or market conditions and other factors described under “Forward-Looking Statements.”

Reconciliations of the forward-looking full-year 2021 outlook for Adjusted EBITDA and Adjusted net income per diluted share and full-year 2022 perspective for Adjusted EBITDA are not being provided as the Company does not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliations.

Conference Call Information

Atkore management will host a conference call today, August 3, 2021, at 8 a.m. Eastern time, to discuss the Company’s financial results. The conference call may be accessed by dialing (833) 968-2233 (domestic) or (825) 312-2056 (international). The call will be available for replay until August 17, 2021. The replay can be accessed by dialing (800) 585-8367 for domestic callers, or for international callers, (416) 621-4642. The passcode for the live call and the replay is 6543529.

Interested investors and other parties can also listen to a webcast of the live conference call by logging onto the Investor Relations section of the Company’s website at http://investors.atkore.com. The online replay will be available on the same website immediately following the call.

To learn more about the Company, please visit the Company’s website at http://investors.atkore.com.

About Atkore Inc.

Atkore is forging a future where our employees, customers, suppliers, shareholders and communities are building better together – a future focused on serving the customer and powering and protecting the world. With a network of manufacturing and distribution facilities worldwide, Atkore is a leading provider of electrical, safety and infrastructure solutions. To learn more, please visit www.atkore.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements relating to financial outlook. Some of the forward-looking statements can be identified by the use of forward-looking terms such as “believes,” “expects,” “may,” “will,” “shall,” “should,” “would,” “could,” “seeks,” “aims,” “projects,” “is optimistic,” “intends,” “plans,” “estimates,” “anticipates” or other comparable terms. Forward-looking statements include, without limitation, all matters that are not historical facts. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of the market in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this press release. In addition, even if our results of operations, financial condition and cash flows, and the development of the market in which we operate, are consistent with the forward-looking statements contained in this press release, those results or developments may not be indicative of results or developments in subsequent periods.

A number of important factors, including, without limitation, the risks and uncertainties discussed or referenced under the caption “Risk Factors” in our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (“SEC”) on November 19, 2020 could cause actual results and outcomes to differ materially from those reflected in the forward-looking statements. Additional factors that could cause actual results and outcomes to differ from those reflected in forward-looking statements include, without limitation: declines in, and uncertainty regarding, the general business and economic conditions in the United States and international markets in which we operate; weakness or another downturn in the United States non-residential construction industry; widespread outbreak of diseases, such as the novel coronavirus (“COVID-19”) pandemic; changes in prices of raw materials; pricing pressure, reduced profitability, or loss of market share due to intense competition; availability and cost of third-party freight carriers and energy; high levels of imports of products similar to those manufactured by us; changes in federal, state, local and international governmental regulations and trade policies; adverse weather conditions; increased costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws; reduced spending by, deterioration in the financial condition of, or other adverse developments, including inability or unwillingness to pay our invoices on time, with respect to one or more of our top customers; increases in our working capital needs, which are substantial and fluctuate based on economic activity and the market prices for our main raw materials, including as a result of failure to collect, or delays in the collection of, cash from the sale of manufactured products; work stoppage or other interruptions of production at our facilities as a result of disputes under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress, or for other reasons; changes in our financial obligations relating to pension plans that we maintain in the United States; reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers; loss of a substantial number of our third-party agents or distributors or a dramatic deviation from the amount of sales they generate; security threats, attacks, or other disruptions to our information systems, or failure to comply with complex network security, data privacy and other legal obligations or the failure to protect sensitive information; possible impairment of goodwill or other long-lived assets as a result of future triggering events, such as declines in our cash flow projections or customer demand and changes in our business and valuation assumptions; safety and labor risks associated with the manufacture and in the testing of our products; product liability, construction defect and warranty claims and litigation relating to our various products, as well as government inquiries and investigations, and consumer, employment, tort and other legal proceedings; our ability to protect our intellectual property and other material proprietary rights; risks inherent in doing business internationally; changes in foreign laws and legal systems, including as a result of Brexit; our inability to introduce new products effectively or implement our innovation strategies; our inability to continue importing raw materials, component parts and/or finished goods; the incurrence of liabilities and the issuance of additional debt or equity in connection with acquisitions, joint ventures or divestitures and the failure of indemnification provisions in our acquisition agreements to fully protect us from unexpected liabilities; failure to manage acquisitions successfully, including identifying, evaluating, and valuing acquisition targets and integrating acquired companies, businesses or assets; the incurrence of additional expenses, increases in the complexity of our supply chain and potential damage to our reputation with customers resulting from regulations related to “conflict minerals”; disruptions or impediments to the receipt of sufficient raw materials resulting from various anti-terrorism security measures; restrictions contained in our debt agreements; failure to generate cash sufficient to pay the principal of, interest on, or other amounts due on our debt; challenges attracting and retaining key personnel or high-quality employees; future changes to tax legislation; failure to generate sufficient cash flow from operations or to raise sufficient funds in the capital markets to satisfy existing obligations and support the development of our business; and other risks and factors described from time to time in documents that we file with the SEC. The Company assumes no obligation to update the information contained herein, which speaks only as of the date hereof.

Non-GAAP Financial Information

This press release includes certain financial information, not prepared in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”). Because not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Further, these measures should not be considered substitutes for the performance measures derived in accordance with GAAP. See non-GAAP reconciliations below in this press release for a reconciliation of these measures to the most directly comparable GAAP financial measures.

Adjusted EBITDA and Adjusted EBITDA Margin

We use Adjusted EBITDA and Adjusted EBITDA Margin in evaluating the performance of our business and in the preparation of our annual operating budgets as indicators of business performance and profitability. We believe Adjusted EBITDA and Adjusted EBITDA Margin allow us to readily view operating trends, perform analytical comparisons and identify strategies to improve operating performance.

We define Adjusted EBITDA as net income (loss) before: depreciation and amortization, interest expense, net, income tax expense (benefit), restructuring charges, stock-based compensation, loss on extinguishment of debt, certain legal matters, transaction costs, and other items, such as inventory reserves and adjustments, realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment and release of indemnified uncertain tax positions. We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of Net sales.

We believe Adjusted EBITDA and Adjusted EBITDA Margin, when presented in conjunction with comparable GAAP measures, are useful for investors because management uses Adjusted EBITDA and Adjusted EBITDA Margin in evaluating the performance of our business.

Adjusted Net Income and Adjusted Net Income per Share

We use Adjusted net income and Adjusted net income per share in evaluating the performance of our business and profitability. Management believes that these measures provide useful information to investors by offering additional ways of viewing the Company’s results that, when reconciled to the corresponding GAAP measure provide an indication of performance and profitability excluding the impact of unusual and or non-cash items. We define Adjusted net income as net income before stock-based compensation, loss on extinguishment of debt, intangible asset amortization, certain legal matters and other items, and the income tax expense or benefit on the foregoing adjustments that are subject to income tax. We define Adjusted net income per share as basic and diluted net income per share excluding the per share impact of stock-based compensation, intangible asset amortization, certain legal matters and other items, and the income tax expense or benefit on the foregoing adjustments that are subject to income tax.

Leverage Ratio - Net debt/Adjusted EBITDA

We define leverage ratio as the ratio of net debt (total debt less cash and cash equivalents) to Adjusted EBITDA on a trailing twelve-month (“TTM”) basis. We believe the leverage ratio is useful to investors as an alternative liquidity measure.

Free Cash Flow

We define free cash flow as net cash provided by (used in) operating activities, less capital expenditures. We believe that Free Cash Flow provides meaningful information regarding the Company’s liquidity.

ATKORE INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three months ended

 

Nine months ended

(in thousands, except per share data)

 

June 25, 2021

 

June 26, 2020

 

June 25, 2021

 

June 26, 2020

Net sales

 

$

853,658

 

 

 

$

384,899

 

 

 

$

2,004,283

 

 

 

$

1,288,001

 

 

Cost of sales

 

514,385

 

 

 

289,086

 

 

 

1,235,970

 

 

 

943,741

 

 

Gross profit

 

339,273

 

 

 

95,813

 

 

 

768,313

 

 

 

344,260

 

 

Selling, general and administrative

 

81,832

 

 

 

46,159

 

 

 

210,250

 

 

 

164,734

 

 

Intangible asset amortization

 

8,707

 

 

 

8,026

 

 

 

25,063

 

 

 

24,210

 

 

Operating income

 

248,734

 

 

 

41,628

 

 

 

533,000

 

 

 

155,316

 

 

Interest expense, net

 

8,090

 

 

 

9,421

 

 

 

24,760

 

 

 

30,605

 

 

Loss on extinguishment of debt

 

4,202

 

 

 

 

 

 

4,202

 

 

 

 

 

Other income, net

 

(509

)

 

 

(543

)

 

 

(8,180

)

 

 

(2,462

)

 

Income before income taxes

 

236,951

 

 

 

32,750

 

 

 

512,218

 

 

 

127,173

 

 

Income tax expense

 

61,654

 

 

 

8,672

 

 

 

126,922

 

 

 

29,112

 

 

Net income

 

$

175,297

 

 

 

$

24,078

 

 

 

$

385,296

 

 

 

$

98,061

 

 

 

 

 

 

 

 

 

 

 

Net income per share

 

 

 

 

 

 

 

 

Basic

 

$

3.69

 

 

 

$

0.50

 

 

 

$

8.08

 

 

 

$

2.03

 

 

Diluted

 

$

3.64

 

 

 

$

0.49

 

 

 

$

7.95

 

 

 

$

1.99

 

 

 

ATKORE INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(in thousands, except share and per share data)

 

June 25, 2021

 

September 30, 2020

Assets

 

 

 

 

Current Assets:

 

 

 

 

Cash and cash equivalents

 

$

397,142

 

 

 

$

284,471

 

 

Accounts receivable, less allowance for current and expected credit losses of $2,713 and $3,168, respectively

 

524,857

 

 

 

298,242

 

 

Inventories, net

 

241,022

 

 

 

199,095

 

 

Prepaid expenses and other current assets

 

67,902

 

 

 

46,868

 

 

Total current assets

 

1,230,923

 

 

 

828,676

 

 

Property, plant and equipment, net

 

257,586

 

 

 

243,891

 

 

Intangible assets, net

 

251,312

 

 

 

255,349

 

 

Goodwill

 

201,545

 

 

 

188,239

 

 

Right-of-use assets, net

 

33,512

 

 

 

38,692

 

 

Deferred tax assets

 

1,295

 

 

 

687

 

 

Other long-term assets

 

1,186

 

 

 

2,991

 

 

Total Assets

 

$

1,977,359

 

 

 

$

1,558,525

 

 

Liabilities and Equity

 

 

 

 

Current Liabilities:

 

 

 

 

Short-term debt and current maturities of long-term debt

 

$

4,000

 

 

 

$

 

 

Accounts payable

 

214,618

 

 

 

142,601

 

 

Income tax payable

 

1,918

 

 

 

1,360

 

 

Accrued compensation and employee benefits

 

45,828

 

 

 

32,836

 

 

Customer liabilities

 

65,563

 

 

 

35,802

 

 

Lease obligations

 

11,335

 

 

 

15,786

 

 

Other current liabilities

 

54,683

 

 

 

47,785

 

 

Total current liabilities

 

397,945

 

 

 

276,170

 

 

Long-term debt

 

780,489

 

 

 

803,736

 

 

Long-term lease obligations

 

22,995

 

 

 

24,143

 

 

Deferred tax liabilities

 

48,494

 

 

 

22,525

 

 

Other long-term tax liabilities

 

1,492

 

 

 

1,619

 

 

Pension liabilities

 

36,049

 

 

 

40,023

 

 

Other long-term liabilities

 

12,858

 

 

 

11,899

 

 

Total Liabilities

 

1,300,322

 

 

 

1,180,115

 

 

Equity:

 

 

 

 

Common stock, $0.01 par value, 1,000,000,000 shares authorized, 46,102,716 and 47,407,023 shares issued and outstanding, respectively

 

463

 

 

 

475

 

 

Treasury stock, held at cost, 290,600 and 290,600 shares, respectively

 

(2,580

)

 

 

(2,580

)

 

Additional paid-in capital

 

501,438

 

 

 

487,223

 

 

Retained earnings

 

211,099

 

 

 

(64,154

)

 

Accumulated other comprehensive loss

 

(33,383

)

 

 

(42,554

)

 

Total Equity

 

677,037

 

 

 

378,410

 

 

Total Liabilities and Equity

 

$

1,977,359

 

 

 

$

1,558,525

 

 

ATKORE INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Nine months ended

(in thousands)

 

June 25, 2021

 

June 26, 2020

Operating activities:

 

 

 

 

Net income

 

$

385,296

 

 

 

$

98,061

 

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

58,475

 

 

 

55,524

 

 

Deferred income taxes

 

17,939

 

 

 

(1,645

)

 

Stock-based compensation

 

14,158

 

 

 

9,302

 

 

Amortization of right-of-use assets

 

10,545

 

 

 

10,995

 

 

Loss on disposal of property, plant and equipment

 

71

 

 

 

6,456

 

 

Loss on extinguishment of debt

 

4,202

 

 

 

 

 

Other non-cash adjustments to net income

 

(1,035

)

 

 

4,668

 

 

Changes in operating assets and liabilities, net of effects from acquisitions

 

 

 

 

Accounts receivable

 

(217,583

)

 

 

44,809

 

 

Inventories

 

(32,556

)

 

 

22,129

 

 

Accounts payable

 

69,353

 

 

 

(45,699

)

 

Other, net

 

9,756

 

 

 

(48,581

)

 

Net cash provided by operating activities

 

318,621

 

 

 

156,019

 

 

Investing activities:

 

 

 

 

Capital expenditures

 

(34,242

)

 

 

(25,590

)

 

Insurance proceeds for property, plant and equipment

 

3,117

 

 

 

789

 

 

Acquisition of businesses, net of cash acquired

 

(43,195

)

 

 

 

 

Other, net

 

17

 

 

 

45

 

 

Net cash used in investing activities

 

(74,303

)

 

 

(24,756

)

 

Financing activities:

 

 

 

 

Repayments of long-term debt

 

(812,120

)

 

 

 

 

Proceeds from issuance of long-term debt

 

798,000

 

 

 

 

 

Payment for debt financing costs and fees

 

(11,294

)

 

 

 

 

Issuance of common stock, net of shares withheld for tax

 

65

 

 

 

(1,821

)

 

Repurchase of common stock

 

(110,063

)

 

 

(15,011

)

 

Other, net

 

 

 

 

(85

)

 

Net cash used for financing activities

 

(135,412

)

 

 

(16,917

)

 

Effects of foreign exchange rate changes on cash and cash equivalents

 

3,765

 

 

 

(452

)

 

Increase in cash and cash equivalents

 

112,671

 

 

 

113,894

 

 

Cash and cash equivalents at beginning of period

 

284,471

 

 

 

123,415

 

 

Cash and cash equivalents at end of period

 

$

397,142

 

 

 

$

237,309

 

 

Supplementary Cash Flow information

 

 

 

 

Capital expenditures, not yet paid

 

$

457

 

 

 

$

713

 

 

Free Cash Flow:

 

 

 

 

Net cash provided by operating activities

 

$

318,621

 

 

 

$

156,019

 

 

Capital expenditures

 

(34,242

)

 

 

(25,590

)

 

Free Cash Flow:

 

$

284,379

 

 

$

130,429

 

 

ATKORE INC.

ADJUSTED EBITDA

 

The following table presents reconciliations of Adjusted EBITDA to net income for the periods presented:

 

 

 

Three months ended

 

Nine months ended

(in thousands)

 

June 25, 2021

 

June 26, 2020

 

June 25, 2021

 

June 26, 2020

Net income

 

$

175,297

 

 

$

24,078

 

 

$

385,296

 

 

 

$

98,061

 

Interest expense, net

 

8,090

 

 

9,421

 

 

24,760

 

 

 

30,605

 

Income tax expense

 

61,654

 

 

8,672

 

 

126,922

 

 

 

29,112

 

Depreciation and amortization

 

20,166

 

 

18,316

 

 

58,475

 

 

 

55,524

 

Stock-based compensation

 

3,768

 

 

1,656

 

 

14,158

 

 

 

9,302

 

Loss on extinguishment of debt

 

4,202

 

 

 

 

4,202

 

 

 

 

Other (a)

 

1,087

 

 

1,581

 

 

(9,194

)

 

 

5,833

 

Adjusted EBITDA

 

$

274,264

 

 

$

63,724

 

 

$

604,619

 

 

 

$

228,437

 

 

 

 

 

 

 

 

 

 

(a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions, gain on purchase of business, realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives, restructuring costs and transaction costs.

ATKORE INC.

SEGMENT INFORMATION

 

The following table presents reconciliations of Net sales and calculations of Adjusted EBITDA Margin by segment for the periods presented:

 

 

Three months ended

 

 

June 25, 2021

 

June 26, 2020

(in thousands)

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

Electrical

 

$

661,163

 

 

 

$

267,824

 

 

40.5

%

 

$

272,151

 

 

 

$

55,549

 

 

20.4

%

Safety & Infrastructure

 

193,492

 

 

 

22,365

 

 

11.6

%

 

113,380

 

 

 

14,150

 

 

12.5

%

Eliminations

 

(997

)

 

 

 

 

 

 

(632

)

 

 

 

 

 

Consolidated operations

 

$

853,658

 

 

 

 

 

 

 

$

384,899

 

 

 

 

 

 

 

 

Nine months ended

 

 

June 25, 2021

 

June 26, 2020

(in thousands)

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

Electrical

 

$

1,535,808

 

 

 

$

589,923

 

 

38.4

%

 

$

919,916

 

 

 

$

200,901

 

 

21.8

%

Safety & Infrastructure

 

470,957

 

 

 

52,810

 

 

11.2

%

 

370,018

 

 

 

50,765

 

 

13.7

%

Eliminations

 

(2,482

)

 

 

 

 

 

 

(1,933

)

 

 

 

 

 

Consolidated operations

 

$

2,004,283

 

 

 

 

 

 

 

$

1,288,001

 

 

 

 

 

 

ATKORE INC.

ADJUSTED NET INCOME PER SHARE

 

The following table presents reconciliations of Adjusted net income to net income for the periods presented:

 

 

Three months ended

 

Nine months ended

(in thousands, except per share data)

 

June 25, 2021

 

June 26, 2020

 

June 25, 2021

 

June 26, 2020

Net income

 

$

175,297

 

 

 

$

24,078

 

 

 

$

385,296

 

 

 

$

98,061

 

 

Stock-based compensation

 

3,768

 

 

 

1,656

 

 

 

14,158

 

 

 

9,302

 

 

Intangible asset amortization

 

8,707

 

 

 

8,026

 

 

 

25,063

 

 

 

24,210

 

 

Loss on extinguishment of debt

 

4,202

 

 

 

 

 

 

4,202

 

 

 

 

 

Other (a)

 

(863

)

 

 

984

 

 

 

(11,860

)

 

 

2,317

 

 

Pre-tax adjustments to net income

 

15,814

 

 

 

10,666

 

 

 

31,563

 

 

 

35,829

 

 

Tax effect

 

(3,954

)

 

 

(2,667

)

 

 

(7,891

)

 

 

(8,957

)

 

Adjusted net income

 

$

187,157

 

 

 

$

32,077

 

 

 

$

408,968

 

 

 

$

124,933

 

 

 

 

 

 

 

 

 

 

 

Diluted weighted average common shares outstanding

 

47,286

 

 

 

47,819

 

 

 

47,513

 

 

 

48,089

 

 

Net income per diluted share

 

$

3.64

 

 

 

$

0.49

 

 

 

$

7.95

 

 

 

$

1.99

 

 

Adjusted net income per diluted share

 

$

3.96

 

 

 

$

0.67

 

 

 

$

8.61

 

 

 

$

2.60

 

 

 

 

 

 

 

 

 

 

 

(a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions and realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives.

ATKORE INC.

LEVERAGE RATIO

 

The following table presents reconciliations of Net debt to Total debt for the periods presented:

($ in thousands)

June 25, 2021

 

March 26, 2021

 

December 25, 2020

 

September 30, 2020

 

June 26, 2020

 

March 27, 2020

Short-term debt and current maturities of long-term debt

$

4,000

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

Long-term debt

780,489

 

 

765,049

 

 

764,379

 

 

803,736

 

 

846,145

 

 

845,694

 

Total debt

784,489

 

 

765,049

 

 

764,379

 

 

803,736

 

 

846,145

 

 

845,694

 

Less cash and cash equivalents

397,142

 

 

304,469

 

 

280,420

 

 

284,471

 

 

237,309

 

 

137,202

 

Net debt

$

387,347

 

 

$

460,580

 

 

$

483,959

 

 

$

519,265

 

 

$

608,836

 

 

$

708,492

 

 

 

 

 

 

 

 

 

 

 

 

 

TTM Adjusted EBITDA (a)

$

702,815

 

 

$

492,274

 

 

$

385,915

 

 

$

326,635

 

 

$

317,249

 

 

$

342,007

 

 

 

 

 

 

 

 

 

 

 

 

 

Total debt/TTM Adjusted EBITDA

1.1

 

x

1.6

2.0

2.5

 x

2.7

 x

2.5

Net debt/TTM Adjusted EBITDA

0.6

0.9

1.3

1.6

 x

1.9

 x

2.1

 

 

 

 

 

 

 

 

 

 

 

 

(a) TTM Adjusted EBITDA is equal to the sum of Adjusted EBITDA for the trailing four quarter period. The reconciliation of Adjusted EBITDA for the quarter ended March 26, 2021 can be found in Exhibit 99.1 to form 8-K filed April 29, 2021 and is incorporated by reference herein.The reconciliation of Adjusted EBITDA for the quarter ended December 25, 2020 can be found in Exhibit 99.1 to form 8-K filed February 2, 2021 and is incorporated by reference herein.The reconciliation of Adjusted EBITDA for the quarter ended June 26, 2020 can be found in Exhibit 99.1 to form 8-K filed August 4, 2020 and is incorporated by reference herein.The reconciliation of Adjusted EBITDA for the quarter ended March 27, 2020 can be found in Exhibit 99.1 to form 8-K filed May 5, 2020 and is incorporated by reference herein.The reconciliation of Adjusted EBITDA for the year ended September 30, 2020 can be found in Exhibit 99.1 to form 8-K filed November 19, 2020 and is incorporated by reference herein.

ATKORE INC.

TRAILING TWELVE MONTHS ADJUSTED EBITDA

 

The following table presents a reconciliation of Adjusted EBITDA for the trailing twelve months ended June 25, 2021:

 

TTM

 

Three months ended

(in thousands)

June 25, 2021

 

June 25, 2021

 

March 26, 2021

 

December 25, 2020

 

September 30, 2020

Net income

$

439,537

 

 

 

$

175,297

 

 

$

124,933

 

 

 

$

85,066

 

 

 

$

54,241

 

 

Interest expense, net

34,217

 

 

 

8,090

 

 

8,416

 

 

 

8,254

 

 

 

9,457

 

 

Income tax expense

147,506

 

 

 

61,654

 

 

38,304

 

 

 

26,964

 

 

 

20,584

 

 

Depreciation and amortization

77,421

 

 

 

20,166

 

 

19,265

 

 

 

19,044

 

 

 

18,946

 

 

Stock-based compensation

17,920

 

 

 

3,768

 

 

4,868

 

 

 

5,522

 

 

 

3,762

 

 

Loss on the extinguishment of debt

4,475

 

 

 

4,202

 

 

 

 

 

 

 

 

273

 

 

Other(a)

(18,261

)

 

 

1,087

 

 

(2,421

)

 

 

(7,860

)

 

 

(9,067

)

 

Adjusted EBITDA

$

702,815

 

 

 

$

274,264

 

 

$

193,365

 

 

 

$

136,990

 

 

 

$

98,196

 

 

 

 

 

 

 

 

 

 

 

 

(a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions, gain on purchase of business, realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives, restructuring costs and transaction costs.

ATKORE INC.
HISTORICAL SEGMENT INFORMATION

The tables below present Net sales for fiscal years ended 2020, 2019 and 2018 and the quarterly periods of fiscal 2020:

 

Net sales

 

Fiscal year ended

(in thousands)

September 30, 2020

 

September 30, 2019

 

September 30, 2018

Electrical

$

1,270,547

 

 

 

$

1,390,327

 

 

 

$

1,327,437

 

 

Safety & Infrastructure

497,523

 

 

 

527,511

 

 

 

509,401

 

 

Eliminations

(2,649

)

 

 

(1,300

)

 

 

(1,699

)

 

Consolidated operations

$

1,765,421

 

 

 

$

1,916,538

 

 

 

$

1,835,139

 

 

 

Net sales

 

Three months ended

(in thousands)

September 30, 2020

 

June 26, 2020

 

March 27, 2020

 

December 27, 2019

Electrical

$

350,631

 

 

 

$

272,151

 

 

 

$

323,218

 

 

 

$

324,547

 

 

Safety & Infrastructure

127,505

 

 

 

113,380

 

 

 

133,130

 

 

 

123,508

 

 

Eliminations

(716

)

 

 

(632

)

 

 

(694

)

 

 

(607

)

 

Consolidated operations

$

477,420

 

 

 

$

384,899

 

 

 

$

455,654

 

 

 

$

447,448

 

 

The tables below present Adjusted EBITDA for fiscal years ended 2020, 2019 and 2018 and the quarterly periods of fiscal 2020:

 

Adjusted EBITDA

 

Fiscal year ended

(in thousands)

September 30, 2020

 

September 30, 2019

 

September 30, 2018

Electrical

$

292,809

 

 

$

285,217

 

 

$

250,853

 

Safety & Infrastructure

$

67,821

 

 

$

77,407

 

 

$

55,755

 

 

 

Adjusted EBITDA

 

 

Three months ended

(in thousands)

 

September 30, 2020

 

June 26, 2020

 

March 27, 2020

 

December 27, 2019

Electrical

 

$

91,908

 

 

$

55,549

 

 

$

77,233

 

 

$

68,119

 

Safety & Infrastructure

 

$

17,056

 

 

$

14,150

 

 

$

17,888

 

 

$

18,727

 

 

Media Contact:
Lisa Winter
Vice President - Communications
708-225-2453
LWinter@atkore.com

Investor Contact:
John Deitzer
Vice President - Treasury & Investor Relations
708-225-2124
JDeitzer@atkore.com

Source: Atkore Inc.

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